Last week, most of the major global stock indices and precious metals ended in positive territories after the latest FED chair Jerome Powell's comments indicated that the Fed will reduce the pace of rate hikes in order to ease the pain of the economic contraction. This week's economic calendar is packed with important events which include the US employment report and the OPEC+ meeting. On the other hand, this week we see interest rate decisions from the Reserve bank of Australia on Tuesday and the Bank of England on Thursday.
On the earnings front, the companies scheduled to release their last quarter financial results this week will be Airbnb, Uber, Pinterest, AMD, Starbucks and Moderna.
The safe-haven metal ended high for the second consecutive week supported by the downward pressure on safe-haven demand for the greenback. Gold prices were steady early on Monday, hovering around a nearly three-week high. The US labour market will set the tone for the gold price this week, as it will offer fresh cues on the Fed’s next policy move and any speakers from the Fed will also be closely watched. The U.S. Federal Reserve raised its key interest rate by 75 basis points last week for the second consecutive time.
This week, the critical resistance for gold is located above 1782, a break above this level will confirm a possible move to 1795 and 1800. On the downside, any meaningful pullback now seems to find some support near the 1755/50 zones, below which the slide could further get extended towards the 1740/36 region.
The king dollar ceded ground in Asia on Monday with greenback bulls still struggling to find upside momentum after the Federal Reserve’s rate guidance last week. This week, USD traders will mainly focus on US labour market data. Markets expect 250,000 new jobs to have been created last month, an increase from the 372,000 jobs gained in June. Meanwhile, the unemployment rate is anticipated to have remained constant in July at 3.6%
From a technical perspective, The 105.50 area of confluence has recently been held as a firm support, failure to defend the mentioned support levels has the potential to drag the pair further towards the 105 support zone. On the upper side, in case the pair manages to settle above 106.30, it will regain upside momentum and head towards the next resistance level at 106.70 and 107.
The currency pair is still weak here despite a modest bounce in the last couple of days. The pair again failed to break above 1.0280 last week and now there is a real battle going on at the current level and we could see a strong move in either direction. The biggest driver for the Euro this week is the retail sales data from Eurozone and the latest PMI numbers from Germany and Europe.
For this week, 1.0170 is the immediate support level, followed by 1.0130. If the pair breaks below 1.0130, the slump will quickly extend toward the 1.0080/70 mark. On the flip side, the bullish breakout of 1.0280 is likely to push the index into a new trading zone, which may offer further buying opportunities until 1.0350 and 1.0380.
The Dow Jones futures started the new week on a stable note lifted by a less Hawkish Federal Reserve outlook and better-than-expected corporate earnings reports. This week the Dow traders will likely keep a look at the economic releases, including the release of the US ISM PMI data and the US labour market report.
This week, the first resistance is located around 31,100, a break above this level will confirm a possible move to 31,300/400. On the downside, any meaningful pullback now seems to find some support near the 32,500 zones, below which the slide could further get extended towards the 32,300 and 32,100 regions.
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